Home CATEGORYGLOBAL Wella Sale at $2.5bn announced by Coty Inc.

Wella Sale at $2.5bn announced by Coty Inc.

by Payal Upase

A strategic sale decision
Coty Inc. announced the strategic sale of its Professional and Retail Hair business – including the Wella, Clairol, OPI and ghd brands (together, “Wella”) to KKR. The company and KKR have entered into amended and restated transaction agreements with a primary adjustment being the removal of certain completion conditions and the sale and transfer of certain entities to Wella post-completion. This sale is at a valuation of $2.5bn is anticipated to be completed by November 30, 2020.

The 60-40 Wella Share
A 60% share of the standalone Wella entity will be owned by KKR while Coty Inc. shall retain only 40% of its share. For the sale, the company will receive an amount of $2.5bn, net of tax and expenses. The net proceeds coupled with Coty’s retained 40% stake in Wella, initially valued at $1.3bn, will considerably strengthen Coty’s capital structure.
It is expected that Coty shall utilize the proceeds of approximately $2bn to pay down its Term Loans A and B on a pro rata basis, with the remainder used for general corporate purposes.

Forward Looking Statements
Certain statements in this Earnings Release are “forward-looking statements” which reflect the Company’s current views with respect to, the sale of the Professional and Retail Hair business, Wella and the investment by Rainbow UK Bidco Limited (KKR Bidco), an affiliate of funds and/or separately managed accounts advised and/or managed by Kohlberg Kravis Roberts & Co. L.P. and its affiliates (collectively, “KKR”) in connection to the standalone business of Wella.
These statements are based on certain assumptions and estimates subject to a number of risks and uncertainties, many of which could be beyond control, cause actual events or result to differ materially from such statements, including risks and uncertainties relating to:

  • the timing, costs and impacts of the Wella transaction, and the amount and use of proceeds from any such transactions;
  • the Company’s ability to successfully implement the separation of the Wella Business;
  • the Company’s relationship with KKR and affiliates, and any related conflicts of interest or litigation; and
  • other factors described elsewhere in their document and in documents that the Company files with the SEC from time to time.

You may also like

Leave a Comment